Yuki Sadamitsu

Director, Oil and Gas Division

Ministry of Economy, Trade and Industry of Japan

Japan’s Energy Policy

2030(After energy

conservation measures)

2013(Actual result)

Energy demand

Final energy consumption

Heat, gasoline,

town gas, etc.75%

Electric power 25%

361 million kl

Thorough energy conservation50.3 million kL

13% lower than before the implementation of the energy

conservation measures

Electric power28%

Heat, gasoline,

town gas, etc.72%

Economic growth1.7%/year

326 million kl

Primary energy supply

2030

Coal25%

Natural gas18%

Petroleum30%

Renewable energy13 to 14%

Nuclear power10 to 11%

489 million kL

LPG 3%

Self-sufficiency

rate24.3%

* Values are approximate.

1. Energy demand and primary energy supply1. Energy demand and primary energy supply

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2. Japan continues to be the largest LNG player despite itsdemand decrease

2. Japan continues to be the largest LNG player despite itsdemand decrease

1970 2010 2012 2030

Fossil Fuel 92％ 82％ 92％ 76％

Others 8％ 18％ 8％ 24％

1970 2010 2012 2030

Oil 70％ 40％ 44％ 33％

Coal 21％ 23％ 23％ 25％

Natural Gas 1％ 19％ 25％ 18％

1970 2010 2012 2030

LNG 1 million ton 71 million ton 90 million ton 62 million ton

Ratio of Each Energy Source in Primary Energy Supply

2

（※Within 2015:Transition to new regulatory authority）

1streform

Legal Unbundling

【1st Step】Apr. 2015

【2nd Step】Apr. 2016

【3rd Step】Apr. 2020

2ndreform

3rdreform

Establishment of OCCTO*

Full Liberalization 

of Retail Market

Transitional Period of Regulated Retail Tariff

Abolishment of Retail Tariff

Establishment of EMSC**

*The Organization for Cross‐regional Coordination of Transmission Operators

Sep.

**The Electricity Market Surveillance Committee

3. Electricity Market Reform Roadmap3. Electricity Market Reform Roadmap

3

K-SADAMITSU

4. Japanese energy system reform puts Japanese utilitiesunder competition

4. Japanese energy system reform puts Japanese utilitiesunder competition

OilCompanies

ElectricityCompanies

GasCompanies

Oil ProducingCountries

Gas ProducingCountries

OilUser

ElectricityUser

GasUser

Energy Companies

Procurement

OilCompanies

ElectricityCompanies

GasCompanies

Oil ProducingCountries

Gas ProducingCountries

ProcurementProcurement

Supply SupplySupply Supply

OilUser

ElectricityUser

GasUser

4

Japan has tried to mitigate supply disruption and secure stable supply by diversifying supply sources. In June 2014, Papua New Guinea became a new supplier.

Japan has a diversified portfolio with the largest supplier only accounting for 20% of total supply and the Middle East dependency at 30%.

(Canada)LNG Canada Project  (2021‐, 13MTA) Pacific Northwest LNG Project (2019‐, 12MTA) 

(U.S.A)Sabine Pass Project (2016‐, 18MTA) Freeport Project (2018‐, 13.9MTA) Cove Point Project (2017‐, 5.8MTA) Cameron Project (2018‐, 12MTA) (Australia)

Wheatstone LNG Project (2016‐, 8.9MTA)Ichthys LNG Project (2017‐, 8.9 MTA)Prelude FLNG Project (2017‐, 3.6MTA)

(Mozambique, Nigeria)Rovuma Area 1 (2019‐, 12MTA)Brass LNG Project (10 MTA)

(Southeast Asia)Abadi Project (7.5MTA)

5

2014LNG Import88.5 MTA

＜production＞＜under construction＞＜planned＞

Australia21%

Qatar18%

Malaysia17%

Russia10%

Indonesia7%

UAE6%

Nigeria5%

Brunei5%

Oman4% Others

7%

5. LNG Procurement Strategy – Diversification5. LNG Procurement Strategy – Diversification

K-SADAMITSU

Japan is dependent on the Middle East for its crude oil imports (83%). Russia is the largest oil supplier except the Middle East (8%).

6

USA

Mexico

Venezuela

Russia

11.3 days

18.4 days

From Venezuela39.2 days

24.2days

3days

18.5days

Australia

15days

Canada

6. Oil Procurement Strategy – Diversification6. Oil Procurement Strategy – Diversification

0.0%0.0% 0.0% 0.0%

4.3%

8.6% 9.1%9.5%

9.8%9.5%

0.0%

1.0%

2.0%

3.0%

4.0%

5.0%

6.0%

7.0%

8.0%

9.0%

10.0%

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

0.7%0.7%

3.5%3.4%

4.4%

7.1%

4.2%4.6%

6.9%

8.2%

0.0%

1.0%

2.0%

3.0%

4.0%

5.0%

6.0%

7.0%

8.0%

9.0%

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Russian shares in Japan’s total oil imports

Source：Natural Resources and Energy Statistics

Year Year

Source：MOF Trade Statistics

S1 startedoil exports

S2 started full‐year production

ESPO startedoil exports

In addition to oil imports from Sakhalin I (2005) and Sakhalin II (1999), the construction of ESPO (2009, 2012) has led to the increase of oil imports from Russia. Currently, Japan imports 8% of its oil from Russia.

Japan imports 10% of its LNG from Sakhalin II, which started LNG exports to Japan from March 2009.

Russian shares in Japan’s total LNG imports

S2 startedLNG exports

ESPO Phase IIStarted oil exports

7

7. Increased importance of Oil & LNG import from Russia7. Increased importance of Oil & LNG import from Russia

K-SADAMITSU

ESPO Phase I(Sep. 2009)

ESPO Phase II(Dec. 2012)

Gas Pipeline

Oil Pipeline

Sakhalin II

・Japanese Firms （Mitsui & Co. Ltd,

Mitsubishi Corporation)・Crude Oil exports to

Japan (since 1999)・LNG exports to Japan

(since 2009)

Sakhalin I

・Japanese Firm (SODECO)・Crude Oil exports to Japan

(since 2005)・Natural Gas undeveloped

INK-Zapad

・Japanese Firm (Itochu, INPEX, JOGMEC)

・Exploration

8

8. Russia and Japan cooperation projects 8. Russia and Japan cooperation projects

2. Shallow Methane Gas Hydrate1. Deep Methane Gas Hydrate1．Offshore Production Test- From March 12-18, 2013- World’s first offshore methane gas hydrate

production by the depressurization method- Total output: 120,000 cubic meters

Ave. daily output: 20,000 cubic meters

2．Cooperation with USA- Based on the Statement of Intent which singed

in 2008, JOGMEC of Japan and NETL of the USA singed MOU concerning Japan-U.S. Collaborationon Methane Hydrate research in Alaska on Nov. 6, 2014.

1．Evaluation of the resource reserves- Shallow methane gas hydrates mainly exists in

the Sea of Japan.- Evaluation of the resource reserve(2013-)- Conducted geological research in 2013 and

2014, discovered 971 potential areas with gas chimneys.

- Drilling survey of shallow methane hydrate in 2014

2．Current Status- Conducted detailed and wide-area geological

research and core sampling

Gas Chimney

Example of cross-sectiondiagram of the sea bed

Flare from offshoreproduction test

Core samples shallow methane

hydrate

9. Domestic resource development (Methane Gas Hydrate) 9. Domestic resource development (Methane Gas Hydrate)

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